Tahir Hussain Vs Assistant Director Enforcement Directorate (Delhi High Court)
Delhi High Court held that prima facie case is made out against the petitioner culpable under section 3 of the Prevention of Money Laundering Act, 2002 as property was obtained as the result of the criminal activity relatable to the scheduled offence.
Facts-
The petitioner, Tahir Hussain, was charged under Section 3 read with section 70, which is punishable under Section 4 of the Prevention of Money Laundering Act, 2002.
The petitioner submits that there no property acquired in the instant case from the proceeds of crime and there are no civil proceedings or attachment proceedings of any kind in the instant case where any property has been attached. were seized from Hussain which could justify the framing of charges against him for money laundering .
Whereas, ED had contended that bank accounts allegedly used by Hussain will be property within the meaning of section 8(5) of the Prevention of Money Laundering Act, 2002.
Conclusion-
Prima facie case is made out against the accused/ petitioner herein of the alleged commission of the offence under Section 3 of the PMLA, 2002 punishable under Section 4 of the said enactment, in as much as, the petitioner allegedly acted prima facie in conspiracy and engaged in money laundering with the proceeds of crime generated having been put to use for riots by way of fraudulently withdrawing money from the accounts of companies owned or controlled by him through bogus and malafide transactions with bogus entry operators on the strength of fake bills and being the beneficiary of the same and with intent to put the said money to fund the Delhi riots and obtained property as the result of the criminal activity relatable to the scheduled offence as the proceeds of crime to make him prima facie culpable under Section 3 of the PMLA, 2002.
FULL TEXT OF THE JUDGMENT/ORDER OF DELHI HIGH COURT
1. The petitioner, Tahir Hussain, arrayed as accused No.1 in ECIR/05-STF/2020 submitted by the Directorate of Enforcement as a complaint under Sections 44 and 45 of the Prevention of Money Laundering Act, 2002 (herein after referred to as the PMLA, 2002 for the alleged commission of the offence of Money Laundering as defined under Section 3 read with Section 70 punishable under Section 4 of the PMLA, 2002, seeks the setting aside of the order dated 3.11.2022 of the Court of the learned Additional Sessions Judge-03, Shahdara, Karkardooma, in SC No. 181/2020; CNR No.-DLSH-01-00-6179-2020 Case No. ECIR/-05-STF/2020 titled Directorate of Enforcement Vs. Tahir Hussain, whereby the orders were passed for framing of charges against the petitioner under Section 3 of the PMLA, 2002 punishable under Section 4 of the said enactment.
2. The respondent, the Directorate of Enforcement, was present on advance notice of the petition and exhaustive oral submissions were made on behalf of either side. Pursuant to the directions dated 15.11.2022 the written submissions have also been submitted on behalf of either side.A catena of verdicts has been relied upon on behalf of either side in support of their rival contentions.
3. The brief facts of the case sought to be asserted by the Directorate of Enforcement against the petitioner are to the effect that:
FIR No. 88/2020 Police Station Dayalpur, under Sections 307/120B/34 of the Indian Penal Code, 1860, qua an occurrence on the date 25.2.2020 at around 3:50 P.M. was registered wherein the complainant Ajay Goswami stated that on 25.2.2020 he had come to the house of his uncle Rakesh Sharma and it was around 3:50 P.M. when he was going to his house at Khajuri and when he reached the corner of the gali he saw a crowd of persons throwing stones and firing bullets on the main road, Karawal Nagar and these persons were committing riots and on seeing them he (Ajay Goswami) started running towards the house of his uncle and then a bullet like thing forcelyhit his right buttock and the persons who were standing there informed that between Gali No. 5 and 6 persons named Gulfam and Tanveer were firing bullets continuously and people standing there asked him to go. Inter alia, the complainant of this FIR stated that the person who picked him up had informed that many persons were firing bullets and throwing petrol bombs from the house of Tahir Hussain (the petitioner herein) and were throwing stones.
FIR No. 59/2020 Police Station Crime Branch under Sections 147/148/149/120B of the Indian Penal Code, 1860 was registered on a complaint of SI Arvind Kumar No. D-5708 who stated that a secret informer had informed him that the riots which took place in Delhi on the dates 23rd, 24th and 25th February, 2020,were a well-planned conspiracy hatched by a student Umar Khalid of the JNU and his companions who were connected with various organizations together and that Umar Khalid had given inciting speeches and made appeals to the people to block the public roads during the proposed visit of the President of America on 24.2.2020 and 25.2.2020 so that a propaganda could be spread at the International level during the travel of the President of America that atrocities were being committed on the minorities in India.
Inter alia, it had been stated in this FIR that under this conspiracy at many houses at Mauzpur, Kardampuri, Jafrabad, Chandbagh, Gokalpuri and Shiv Vihar and the areas around the same, fire arms, petrol bombs, acid bombs, stones catapults to throw the same and other deadly weapons were collected and at different places, the ladies and children gathered below the Jafrabad Metro Station as a part of the conspiracy on 23.2.2020 so that people living around were harassed and there was an increased tension and riots could take place.
FIR No. 65/2020 Police Station DayalPur was registered on 26.2.2020 qua an incident of the date 25.2.2020 that occurred between 16:45 hrs to 18:45 hrs on the basis of a complaint made by one Mr.Ravinder Kumar s/o Man Singh r/o E-140A, Gali No.6,Khajuri Khas, DayalPur, who stated that on the main road from Bhajanpura to Karawal Nagar on Chand Bagh Pulia, an agitation against the CAA had been going on for several days in which both parties had been indulging in stone throwing and putting fire and firing with weapons. It was further stated through this FIR that the office of the then Municipal Councillor Tahir Hussain (the petitioner herein) was near the Chand Bagh Pulia and in this office he, i.e., Tahir Hussain (the petitioner herein), had gathered gunda elements and who were firing from the top of the office throwing petrol bombs and stones due to which there has been much tension and a fearful environment in the public at large.
It was further stated in the said FIR that on the date 25.2.2020 Ankit Gupta, the son of the complainant, who had gone out in the evening at 5 P.M. to get some household articles did not return for much time and after making enquiries and waiting for the entire night, the missing report was lodged whereafter it was learnt that a boy had been killed and thrown in the Chand Bagh drain from the top whereafter with the assistance of the police the dead body of the complainant‟s son was found wearing only underwear with sharp edged weapon injuries on his head, face, chest back side, midriff with the face and other body parts having been burnt with some acid like substance in order to conceal the identification. Through this FIR it was stated by the complainant thereof that he had complete belief that Tahir Hussain (the petitioner herein) and the persons gathered in his office had committed the murder of his son and thrown him in the drain from the Masjid.
The offence punishable under Section 302 of the Indian Penal Code, 1860 qua which inter alia FIR 65/2020 Police Station DayalPur and the offences punishable under Section 120B of the Indian Penal Code, 1860 in relation to which FIR No. 59/2020 Police Station Crime Branch and qua the offences punishable under Section 120B and 307 of the Indian Penal Code, 1860 in relation to which FIR bearing No. 88/2020 Police Station DayalPur had been registered, are all scheduled offences in terms of paragraph 1 to the Schedule read with Section 2(y) to the PMLA, 2002 2(y) of the PMLA, 2002 which defines scheduled offences as under:
―2 Definitions. —
(1) In this Act, unless the context otherwise requires,—
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(y) ―scheduled offence‖ means—
(i) the offences specified under Part A of the Schedule; or
[(ii) the offences specified under Part B of the Schedule if the total value involved in such offences is one crore rupees or more; or]
[(iii) the offences specified under Part C of the Schedule;]“
4. As per the averments made in the ECIR enquiries were initiated under the of the PMLA, 2002 after recording the brief facts of the scheduled offences in the ECIR/05-STF/2020 dated 9.3.2020 (RUD-6)by the Special Task Force of the Directorate of Enforcement (HQs), New Delhi in as much as the offences punishable under Section 120B/302/307/385 of the Indian Penal Code, 1860 are scheduled offences in para 1 of part A of the Scheduled Offences under Section 2(1)(y) of the PML Act, 2002. The ECIR/05-STF/2020 submitted by the Directorate of Enforcement states inter alia to the effect:
“4. Brief facts of the offence/allegation/ charge/ amount involved under PMLA:
4.1. After recording the aforementioned ECIR, investigation in the matter was taken up. The following documents and evidences were collected/obtained:
(1)Bank statements of bank accounts maintained in the name of M/s Show Effect Advertisement Pvt. Ltd. (hereinafter referred to as SEAPL ), Show Effect Worldwide Pvt. Ltd. (hereinafter referred to as SEWPL), Essence Cellcom Pvt. Ltd.( hereinafter referred to as ECPL) Essence Global Services Pvt. Ltd. (hereinafter referred to as EGSPL), Saifi Wooden Works, Sh.Tahir Hussain and Smt. Shama Anjum (wife of Tahir Hussain) were called for from HDFC Bank and Bank of Baroda.
(ii) Copies of FIR. No. 59/2020 dated 06.03.2020 registered by Crime Branch, Delhi Police and FIR No. 65/2020 dated 26.02.2020 and 88/2020 dated 01.03.2020 recorded by P.S. Dayalpur, New Delhi
(iii) Documents/digital devices recovered and seized from various premises during searches conducted on 23.06.2020, 25.06.2020 and 26.06.2020.
(iv) Statements of the suspects & witnesses, recorded under Section 50(2) & (3) of the PMLA, 2002.
4.2. Examination of the bank accounts of M/s SEAPL. ECPL and EGSPL for the period October 2019 till March 2020 and correlation of transactions with counterparty details obtained from Banks revealed that fraudulent RTGS transactions to the tune of Rs. 1.5943 Crore were done by these companies with dubious entities by giving false narration in the RTGS transactions. Investigation revealed that Tahir Hussain was involved in the acts of cheating and falsification/forgery of documents which resulted in fraudulent removal of money from the accounts of the said three companies (M/s SEAPL, ECPL and EGSPL). On the directions and. instructions of Tahir Hussain, huge amounts of money was withdrawn from the accounts of the said three companies by way of transfer of funds to entry operators and bogus companies. Tahir Hussain was the ultimate beneficiary of the laundered money which he used for fulfillment of ulterior motives. Fake and bogus invoices were created to cover the money trail.
4.3.1. The amounts withdrawn from the accounts of the said three companies through fraudulent transactions are mentioned below:
i. M/s SEAPL [Directors: Sh. Tahir Hussain and Smt. Shama Anjum (wife of Sh. TahirHussain]:Rs. 47.43 lakh
ii. ECPL[Directors: Sh. Tahir Hussain, Sh. Nitesh Kumar Gupta and· MohammadAkram]: Rs. 92 lakh
iii. EGSPL [Directors: Sh. Nitesh Kumar Gupta and Mohammad Akram]: Rs. 20lakh
4.3.2. Investigation revealed that funds were transferred through RTGS mode by the aforesaid three companies to the accounts of fictitious/bogus entities created by entry operators. The details of the bogus companies and entry operators through whom the above mentioned fraud was carried out are given below:
